Product purchasing is an important aspect of running a successful business operation. Many business owners dedicate significant resources to cultivating and maintaining supplier relationships. Unfortunately, when purchasing significant numbers of products from more than one supplier, it can be difficult to select an appropriate supplier for each product, decide when to buy the product, determine the correct quantity to order, and to continuously monitor dynamically changing prices, promotions, and product offerings.
Another inefficiency involved in product purchasing is the substantial overhead of entering data into a business inventory system. When dealing with multiple suppliers using differing and sometimes incompatible software, businesses are sometimes required to perform manual data entry and to manually re-order new products when quantities are low. In order to minimize this inefficiency, some businesses utilize only a small number of suppliers, and will elect to forego purchasing at a discount from a different supplier just to avoid the potential overhead costs.
Each supplier may provide a paper or electronic invoice to the business along with each order. As invoices arrive, the business must continuously update its inventory management system and must continuously monitor supplier and inventory data in order to make prudent financial decisions. As point-of-sale (POS), inventory, and financial management systems have become ubiquitous in the retail environment, the sales, inventory, and financial management of business operation has grown increasingly disconnected from product purchasing and supplier relationship management.